Real estate speculation threatens future of Metro Vancouver farmland

KPU studies agriculture real estate speculation as it threatens the future of an economically viable bioregion in Richmond and Southwest B.C.

Real estate speculation of local farmland has passed the “tipping point” and is the leading threat against building a sustainable, job-producing regional food system, according to Dr. Kent Mullinix, director of Kwantlen Polytechnic University’s Institute for Sustainable Food Systems.

“To put it quite bluntly, the provincial and federal governments have allowed this huge influx of wealth to come in here and it’s skewed the market; it’s blown it out of the water,” said Mullinix.

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The institute is busy these days, undertaking three major research projects that aim to promote local food production. One of those projects is reclaiming a 20-acre educational farm on the Garden City Lands. Preliminary work begins this summer on it, after Richmond city council approved the partnership earlier this year.

As the KPU farm at Garden City becomes a reality, Mullinix is also set to soon publish findings of a study that looks at how a “bioregional food system” could develop in Southwest B.C. The possibility of the Lower Mainland becoming more food secure is, however, dependent on solving the problem of real estate speculation on farmland, which is the focus of yet another ongoing study at the institute.

“The cost of land is in the way. There’s no direct link between the cost of land in Southwest B.C. and the cost of food. They’re detached. It’s not even remotely related,” said Mullinix.

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Vancity report shows that since 2005 real estate prices for farmland have risen sharply. Small agricultural properties have been speculated upon the most.

For instance, farmland in south Richmond is now being sold for roughly $300,000 per acre. 

“There’s no farming that can service that cost,” said Mullinix.

A new report from Vancity, titled Home on the Range, notes the financial viability of many farm businesses in B.C. becomes questionable when land prices reach $80,000 per acre.

Mullinix and his staff, as well as students, are presently mapping out who exactly owns what farmland in the Lower Mainland.

“What we’re trying to do is get to the question of who owns this land and why is it so expensive. It’s not (monetarily) valued for agriculture,” said Mullinix.

“We think it’s going to be very interesting to find out who owns it. I think what we’re going to find is a lot of agricultural land is not held by agricultural concerns. So, we hope to find out why it’s being held. Is it an investment? Are people determining it can be pulled out of the Agricultural Land Reserve (ALR) and developed, or what?”

The ALR was established in 1973 and protects farmland across the province. There are about 12,000 acres of ALR land in Richmond, which, generally, cannot be developed unless approved by both municipal and provincial governments (via the Agricultural Land Commission).

But as Coun. Harold Steves has noted, local real estate companies are presently advertising farmland as investments for future development — hence the skyrocketing prices.

“Only a small number of landowner applications for removal are successful, however the possibility of success may still encourage speculation and be a factor affecting the price of larger parcels of farmland,” noted Vancity.

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Statistics Canada shows a sharp incline in fruits and vegetable price in Canada. Graph by Vancity report Home on the Range.

Mullinix said this sort of valuation of farmland is hitting everyone in the pocketbook because as the region sees more unused farmland appear, local food becomes even more scarce, leading to a greater reliance on expensive imports.

Largely as a result of California’s drought, Vancity noted price increases of 26 per cent for fresh vegetables and nine per cent for fresh fruit for local consumers since January 2015.

If local farmers were to buy land at the current speculative values, prices for local food would further skyrocket; lettuce would cost 18 per cent more, cabbage 35 per cent more and potatoes 68 per cent more.

Farmers can lease, but the Vancity report notes there are inherent flaws in this system.

“Fewer capital investments and land stewardship practices are made on leased farmland because of the short-term tenure of agreements.”

Presently, about one-third of farmed land in Metro Vancouver is leased. 

Furthermore, Mullinix estimates some 44,000 acres of farmable land is not in production in Metro Vancouver.

Adding to the pressures is the increase in estate homes being built on ALR land. Such mansions are numerous in Richmond and set a new price benchmark for the land, based on its value as a luxury residential property instead of a working farm, according to the report.

Solutions have been pitched by local stakeholders, according to the report, such as: taxation policies to promote food production, encouraging long-term leases through policy, gathering ownership data, an end to ALR exclusions altogether and innovative partnerships.

On the latter point, the City of Richmond’s agreement with KPU to develop the Richmond Farm School and incubator farm, where students can access municipal land to farm, is one example. 

With potential solutions in hand, Mullinix is soon set to release the findings of the Southwest B.C. Bioregion Food System Design Project.

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This is the Southwest B.C. bioregion that a KPU study hopes to show can be an environmentally and economically sustainable food system for Metro Vancouver. Map by KPU

“The preview is this: Even with the significant increase in population, if we play it right, we have the opportunity to substantially increase regional food self-reliance,” said Mullinix.

The study will outline the economic benefits of doing so, such as examining how a more robust farming system can result in more jobs, taxes, GDP enhancement and business opportunities.

Creating this regional food system, from Hope to the Sunshine Coast, will mean getting local companies on board, as well as capital investments to improve soils and biodiversity.

“We’ve taken agriculture and food for granted. We’ve assumed this global system would provide cheap food forever. What we’re finding out, it’s not cheap anymore and it’s certainly not assured with climate change,” said Mullinix.

He added that a part of the solution to the farming fiasco is to have regular residents reconnect with farming. To do that, Mullinix is a big proponent of urban/farm interfacing, which occurs in Richmond.

“There’s this dichotomy here. The dynamics are really interesting. There’s this community that values agriculture and sustainable food systems and wants to preserve, and is proud of, its agriculture heritage, but then it also sees itself as this bustling metropolis. . .It’s demonstrated around the world that a thriving bustling city can exist with agriculture,” said Mullinix, who nevertheless added that he found it “interesting” that council approved a strip mall next to the Garden City Lands. 

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